Ad Blocker Detected
Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker.
– [Narrator] Starting a business during a recession can be an amazing opportunity to build influence when other businesses are scared to make any moves. These five recession-proof business ideas have held fast through tough economic times. That being said, you can recession-proof practically any business idea by focusing on employee retention, honing in your marketing, and building a reserve of liquid funds so you can make big moves while other businesses are struggling.
Sweet Treats. Even though consumers cut back on their spending during times of economic hardship, people still allow room in their budget for what trend analysts call, “Small indulgences.” Though it may surprise you, businesses that deal with sweet treats, like doughnuts and chocolates, prosper during recessions. A brief recession between 1990 and 1991 saw the sale of doughnuts account for 15.7% of all bakery sales, almost two percentage points higher than in 1989. Many treats became popular during The Great Depression in the ’30s. Snickers were born, Little Debbie hit the pavement, and Krispy Kreme was founded on the sale of thousands of yeasted doughnuts. Years later, when America faced the Great Recession, candy manufacturers like Cadbury, Nestle, and Hershey’s yielded great profits.
And thanks to Nestle, the Toll House Inn created the chocolate chip cookie. Since chocolate boosts serotonin and endorphin levels in the brain, it’s natural that people turn to the sweet treat when they’re feeling anxious. Cadbury’s profits alone increased by 30% in 2008. If you’re an entrepreneur with a sweet tooth, you may consider starting a bakery or chocolate treat. Put your treats above the rest by getting international with your recipes, and create items that are either gluten-free, low sugar, or vegan. The more options you provide the larger your customer base. Cleaning Services. While residential cleaning services often take a hit during recessions, commercial cleaning services are always ticking along no matter what the economy is like. After all, a clean office is a more productive workspace. Even though this is a competitive industry, there’s plenty of room for improvement.
Every year, the average cleaning company loses up to 55% of their clients due to poor service. If you offer thorough, high-quality services and even something unique, you have an excellent shot at succeeding in this market. Between 2007 and 2017, the cleaning industry grew on average at a rate of 6.6% each year, and industry revenue is predicted to increase over the next five years. Having upsell services are a good way to cater to those who want an approachable, entry-level price, while also finding more ways to increase your bottom line and create cash reserves. Grocery Stores. Opening a grocery store is a safe bet during a recession, because as money gets tight, more people cook their own meals instead of going out to eat.
Spending at grocery stores only dipped 1.6% during the Great Recession, while spending at restaurants dropped by nearly 13%. Grocery stores are known to flourish during economic hardships because of their essential nature. Kroger hired 16,000 people in 2008, and Trader Joe’s started, expanded, and evolved through several different recessions. Better yet, even when a recession is not happening, this business is still successful. In the past five years, the grocery store industry has grown at a steady rate of 1.2%, and that rate is predicted to keep growing. By focusing on employee satisfaction and connecting with local food production, you can boost retention within your community. Child Care. People will always want their children to have the best care, which is why this industry will stand the test of time. If you don’t want to start your own entire child care business, you can still find profitable ways to support the people who are in that industry, or even support people who homeschool their children. The number of homeschooled children has been increasing at a steady rate each year.
Over five years starting in 2007, there was an 18% increase in the number of children being homeschooled. There are now over 2.5 million students who learn from home.
Consider ways you can provide supplies and resources targeted at this evergrowing group. Here’s another segment of the learning market. Single mothers, and subsequently their children, get hit hard during recessions. In 2009, single mothers of children under the age of six had an unemployment rate of 17.5%. Providing support such as affordable learning alternatives, or ways to connect with reputable sitters, will not only grow the economy, but improve the childhoods of future generations. To boost your child care-based business, consider offering subjects that traditional schools cannot or do not have. Home economics, nature activities, and communication workshops can allow children to exercise their brains while having fun. Thrift Stores. Resale and thrift stores are one of the few types of businesses that actually thrive during times of economic uncertainty.
Since the Great Recession, and even The Great Depression, consumers have been trained to hunt for the best deals. This makes it hard for big department stores to compete with resale and thrift stores. An August 2009 survey of resale and thrift shops concluded that 64.1% saw an increase in sales from 2008. ThredUP, an online clothing consignment service, is an amazing example of a unique thrifty option that sprung from economic hardship during the last recession. Half Price Books, a Dallas-based operation that sells used books and magazines, saw an increase in sales to around $200 million through 2009. There was also a rise of 10% for total sales, including the four new stores they opened in 2008 alone.
The beauty of resale stores is that they’re so much more available than clothes. People also want to furnish their homes and inexpensively treat themselves to games, books, and more. People tend to lean towards wallet-friendly, DIY projects during economic hardships. They look to resale stores to fulfill those desires. The transaction is twofold. Customers enjoy recycling their old wares and making a quick buck, while the store itself offers unique items at affordable prices. Make your thrift store more inviting by creating a boutique atmosphere, and consider giving local artists a place to sell their wares. This list is just the tip of the iceberg. Small businesses are the lifeblood of every community. We want you to be passionate and prepared for a lifetime of entrepreneurship.